Lao Tax Collectors Pay to Play

2016-01-19
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Luang Prabang Province Tax Office, in undated photo.
Luang Prabang Province Tax Office, in undated photo.
RFA

In Laos, where corruption seems like a part of daily life, the locals say tax collectors often stand out as they can be seen driving some of the flashiest cars and living in some of the biggest houses.

In this landlocked Asian country with an authoritarian government that ranks a dismal 145th out of 175 nations in Transparency International’s corruption index, a tax collector’s job is a ticket to easy street.

But to get one, you need to know someone and have a pocket full of cash.

“It is well known that it is not easy for ordinary people to apply to work at the tax and custom sectors in Laos,” Sawang Silavanh, deputy director general of tax department in Luang Prabang province told RFA’s Lao Service on Jan. 13

Indeed, a finance ministry official told RFA that of the 400 people who apply each year for jobs at the tax and customs department only four get hired. And while there is a civil service test, sources say an applicant’s score matters less than the people the applicant knows.

“The people who will be in those positions have already been on the list,” the ministry official told RFA. “No matter whether they pass the tests or not, they will be selected because they are backed by high ranking officials.”

Not only is it who you know in Laos, but what you can pay.

“The people who will be accepted to work at the tax and custom department must pay under the table at least 50 million kip (about U.S. $6,100),” the source said. “If  they are accepted to work at an international border checkpoint, they must pay at least 100 million (about U.S. $12,000) because they can easily earn more money for two years,” the official said. “That’s why so many people would like to be a tax collector.”

Open secret in Laos

While corruption is an open secret in Laos, it still rankles ordinary citizens who feel they are the victims of an unscrupulous tax man.

A guesthouse operator in the  Luang Prabang province, told RFA that he wants the government to investigate the tax department for corruption.

“I have run a guesthouse for five years, and I pay my full tax payment based on the law,” he told RFA on condition of anonymity. “But my neighbor runs the same business, and he pays less tax because he is a tax officer.”

The businessman says the lifestyle led by tax and customs officials is galling to the average Lao struggling to make ends meet.

“The majority of tax and custom officials are richer than other civil officials – they have big cars and houses,” he said. “I do not know where they get money from if it is not from corruption.”

Ordinary Lao citizens see that corruption every day, he said.

“They will deal with vendors to officially charge less tax, but get money under the table in return,” he said. “Everybody knows those officials get involved in corruption, and that is normal in Laos.”

Sawang Silavanh defended his workers, saying the perception that tax collectors enrich themselves is unfair.

“In this province, the same officials do not run their own businesses, but their family members do,” he said. “However, they must pay the full tax in principle because in this province if the officials have businesses they must set a good example.”

When asked why tax and custom officials get richer than others, he said: “All the officials are not as rich as the public complains, but only those whose families are rich before working as the tax and custom officials.”

Reported by RFA’s Lao Service. Translated by Ounkeo Souksavanh. Written in English by Brooks Boliek.

Comments (4)
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Anonymous Reader

Visited Laos before and you can tell who works for the government (ie. tax collector) by their home.

Drive around the country and you'll see. There be a gated mansion in between shack homes. It's crazy. Shack, shack, mansion, shack, mansion, shack, schack, etc.

It's so obvious corruption is part of doing business in lazy Laos!

How long will the people put up the corrupt Laos gov't!

Jan 20, 2016 05:51 PM

Anonymous Reader

Sawang Silavanh is rich himself! He has several mansions and drives the newest cars?

Jan 20, 2016 05:45 PM

Superman

from Krypton

That's right, corruption is the way of life in Laos. If you can beat it, join it.

Jan 20, 2016 02:13 AM

Anonymous Reader

It's time to change regime, change the constitution, and change the form of government to democratic government. No wonder why the government officials are so rich but the people are so poor. No wonder why prostitution is every where in Vientiane and other cities. All government officials are not leaders...they are corruptors.

Jan 19, 2016 10:03 PM

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